From the Canadian press
Published April 19, 2022 at 8:30 p.m.
The Ontario government has allowed property sellers to disclose details of competing offers, but it has not banned blind bidding in Mississauga, Brampton Hamilton and the rest of Ontario.
Government and Consumer Services Minister Ross Romano said in a statement that sellers would be able to choose whether they wanted to “choose an open bidding process” and share bids.
“Sellers will no longer limit themselves to selling their properties through a closed or traditional bidding system,” he said.
Blind bidding, a practice in which buyers bid for a home without knowing the size of competing bids, has been cited by some as one of the engines behind inflated gains in house prices.
The provincial government’s move is part of a larger reform of the Real Estate Services Trust Act.
The changes, which include a new code of ethics for real estate agents, more clarity for buyers during the home purchase process and greater powers for the Ontario Real Estate Council to prosecute bad actors, should take effect 1 April, 2023
The Ontario Real Estate Association (OREA) said in a statement that it welcomed the changes and worked closely with the province to propose them.
“(This achieves) the right balance between adding more transparency to the supply process and protecting homeowners’ right to sell their homes as they wish, instead of completely banning the traditional supply process,” said Tim Hudak, the association’s chief executive. .
Some experts see more transparency as a step in the right direction, but do not believe that the latest move by the provincial government is doing enough to make the bidding process fair.
“There’s no point in making (bidding) of choice for sellers,” said Sung Lee, a mortgage expert at Ratesdotca. “Blind bidding benefits sellers, not buyers. If the goal is to create transparency, this must be mandatory. “
The changes come a week after Ontario Prime Minister Doug Ford said he was “not in favor of adding new regulations” in a video posted on OREA’s Twitter feed.
The move comes just weeks after the federal government announced in its latest budget that Housing Minister Ahmed Hussein would work with provinces and territories to develop a plan to end blind bidding and implement a law on home buyers’ rights.
Some brokers and housing experts oppose a total ban on blind bidding, saying it will do little to cool the country’s hot housing market and that sellers must decide how they want to sell their homes.
This report from The Canadian Press was first published on April 19, 2022.
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